Question: John is considering adding balloons to the product line he sells at the shop. There will be a cost of $200.00 for leasing the necessary equipment. The cost of buying balloons and helium and paying a worker is expected to be $4.25 per unit (balloon). He expects to sell the balloons for $6.75 each.

1. Write the total cost function.
2. Write the variable cost function.
3. Write the revenue function.
4. If John sells 70 balloons, calculate: average fixed cost, variable cost, revenue, average total cost.
5. Will there be a profit or loss at this level of sales? How much?
6. Determine the breakeven number of balloons.

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